Should Mi Comisariato of Garzota enter online selling and home delivery to later expand this service to other subsidiaries?
Theoretical Framework: Today, people are being busier on their jobs that they do not have time to go to a grocery store and buy their necessities. As a result, grocery stores should consider if they begin to retail online. The target market is young-adults and adults that have a busy work schedule and do not have time for going to the grocery store. Mi Comisariato should consider expanding its online since it will make them be the pioneer compared its potential competitor, Supermaxi, and it will gain brand loyalty from customers. In addition, this type of service will provide Mi Comisariato an extra revenue since the delivery service will be charged separately. However, this project will act as a pilot project since if it becomes successful, it can be applied to other Mi Comisariato’s subsidiaries. Nevertheless, there are certain limitations. A major limitation is that costs from delivery service which include gas, staff and website maintenance can’t be known with exact values. Another limitation is that Mi Comisariato financial staff does not want to provide the percentages of their increase on sales during the last three years. These percentages are needed since it will provide support to my project and credibility. A second limitation is that my survey will be limited since I will do it on Mi Comisariato Garzota and Mi Comisariato Urdesa. Finally, a third potential limitation is the lack of internet access in Ecuador since only 24% has it. . In addition, the acceptance of online purchase has a low percentage since there is low trust on this kind of service. Methodology: I plan to analyze about the advantages and disadvantages that Mi Comisariato will have by implementing the online and home delivery service. The project includes costs as creation of maintenance of web page, delivery service and credit card transaction costs. Techniques as SWOT, PEST, cost-benefit analysis and Ansoff Matrix are considered in order to know the potential opportunities, threats and feasibility of project. PEST analysis is going to be done in order to know the opportunities and threats from the macro environment. SWOT analysis is going to be executed with the purpose of showing the strengths and weaknesses from the company, Mi Comisariato. Ansoff Matrix is going to be made to determine the type of strategies that should be applied in order for
the execution of this project. Finally, cost-benefit analysis will complete all the analysis by determining the costs and benefits Mi Comisariato will face with the implementation of this new service.
Primary research: • Have an interview with Mi Comisariato’s Sale Department of Guayaquil in order to get information about their annual sales, strategies that can be applied, evaluate costs and how much interest will develop this idea between consumers. Survey for Mi Comisariato’s customers in order to know if they are interested or not on this service.
Secondary research: • • Investigate about companies that provide cars with drivers in order to do the delivery service to customers. Research how much will cost the creation and maintenance of the web page
Possible Problems Solutions Questions that may not be Ask open and uncomplicated answered by Mi questions in order to get at Comisariato’s Sales Dept least estimate on annual sales. because of confidentiality. Limited info since I will Get opinions about other Mi interview only one manager. Comisariato’s managers. Difficulty to determine how Make accurate decisions on the many delivers can be done questionnaire in order to have per day. an exact estimate. Difficulty on knowing Get info from internet related or exactly Mi Comisariato’s make a survey about Mi market share Comisariato’s market share. Table 1. Problems encounted and possible solutions.
Bruno Sadun Surveys are done to customers Midterm break Beginning of first draft Give Mr. Search info about costs of web page Interview with Mi Comisariato’s Sales Manager. Evans my Correct mistake second draft Final draft is done Three copies are given of my final research proposal – Preparation for IB exams and Research Proposal Presentation Thesis presentation
July 25 August 7-23 September 1 September 7 September 11 September 18 September 21 October November January 4-5
.Dates June 17 June 20
July 1 July 5 July 24
Activities Modifications Do a sample of rough draft for my survey. Evans my first rough draft Beginning of second draft Give Mr. Call Lucy Lazo in order to set an appointment with Mi Comisariato’s Sales Manager Show if my survey is correct in order to do it.
Action plan for my research proposal
Business and Management Higher Level Research Project
Should Mi Comisariato of Garzota enter online selling and home delivery to later expand this service to other subsidiaries? November.Table 2. 2009
This project is dedicated to my family. friends and teachers who have helped me on the execution of it.
PAGE # Executive Summary………………………………………………………………………………… ……4 Introduction……………………………………………………………………………… ……………….…15-16 and Results Information and and Collection……………………………………………….…7-12 Discussions………………………………………………………………………………
..…6 Findings……………………………………………………………………….....…23 and and Recommendations…………………………………………………………... ……17-22 Bibliography References……………………………………………………………………..…5 Methodology Main Analysis 13-14 Conclusions Appendix ……………………………………………………………………………………………….
Also. Also. if they trust or no on the service or on how many days they will like to receive their purchase. The reason of this conclusion is because Ecuadorian society is not prepared for this type of selling and there is a high risk that the project may fail. The recommendation for the company is that this type of selling should not be implemented until three or five years. Mi Comisariato should implement it when perception among society about this service changes. As a result. a survey was done to customers in order to find if they will use it or not. The survey contained questions about what they think about online selling.
. mostly of the customers prefer to choose the product than buying them by online. the uncertainly on the acceptance of this project on society creates doubt about investing or not. there is a lack of security that customers have about purchasing online. it will be the pioneer. the lack of access to internet gives disadvantage to Mi Comisariato because they might lose purchases because customers do not have access to it. To start the project. In addition. These two reasons are the main ones why customers still prefer to go to the grocery store and not buying by online. an interview with El Rosado’s Manager of Purchases was done in order to know what this corporation has thought about online service and why they have not implemented yet on society. in order to have a successful project.Executive Summary
The goal of this study is to find out if online selling can increase Mi Comisariato’s revenues and if it will have a good receipt among customers. Any company of this market has started to sell by online and if Mi Comisariato does. Also. Once having the results.
Czarninski decided to close the restaurant and just stay with its new successful business. there are more than 80 Mi Comisariato stores in Ecuador. he and his wife Ruth thought on changing their bakery into a restaurant. Czarninski opened other stores as toy stores. As years passed.
. Because the grocery store was having such a success. they changed the appearance of the bakery and made it into a restaurant. Mr. The store had such success that Mr. As the business began to be more successful. Actually. So. Alfredo Czarninski opened a small bakery in Guayaquil’s downtown called ¨El Rosado¨. Mr. In 1970. Czarninski decided to purchase in front of its restaurant a store in order to have a grocery store. the grocery store’s name changed to Mi Comisariato. movies. This store was the first in Ecuador to offer the auto-service and was called ¨El Rosado Supermarket¨. These stores are part of EL ROSADO CORPORATION S.A.Introduction
In 1936. retail stores and ironmongers.
Bruno Sadun. as it is expected. so it can be concluded that the company that starts offering that service will have a huge success or a total failure. One cost is the creation and maintenance of the web page. This interview will help me by knowing if Mi Comisariato has ever thought to enter on the online selling and if it yes. which the values are provided by a company that works at Guayaquil. I have to set an appointment with Mi Comisariato’s Sale Manager. why they have not done yet. In order to determine if the online selling will benefit Mi Comisariato and create brand loyalty.Procedure or method
Online selling is a service which has not been exploded by local companies and not often used on society. My primary research is based on having an interview with Mi Comisariato’s Sales Manager and a survey to Mi Comisariato’s customers. the costs of the home delivery are given by a company that offers this type of service and will charge per each delivery they do. I applied the sample size estimation formula which result was 41 surveys to do. None local grocery store has started to sell by online. In order to know how many surveys I had to make. The survey will be done to Mi Comisariato’s customer in order to know what they think about this project and if they are willing to purchase online. First. investigate about retail stores’ websites in order to know what kind of strategies Mi Comisariato can apply for its webpage. I had to make some important research in order to have a specific answer to my doubt. Also. Secondary information will include the all the costs (variable and fixed) for the implementation and operation of the project. The costs of credit card transactions are also included since there will be customers that may prefer to purchase online with credit card and that cost should be known according the bank. Lastly.
Average income per month
Figure 2.Main Results and Findings
Primary data obtained through surveys
Figure 1. How frequently do customers purchase at Mi Comisariato
Reasons why customers will not purchase by online
. Customer’s willingness to purchase online
Whyyou will not purchase by online? No complete knowledge
16% 32% about Internet usage No trust on this type of service Prefer to choose the product Includes an extra value to the purchase
5.Figure 3. Reasons why customers couldn’t shop at Mi Comisariato
Reasons why customers will purchase by online
. Days customers desire their purchase be delivered
Figure 8.Figure 6. Reasons why customers will purchase by online
Average of bills when customers buy at Mi Comisariato
Figure 10.Goods that will be usually bought by online
.Figure 9. How much do customers usually pay for home delivery service
price and its manufacturer. Costs of web page’s creation and maintenance during one year. Also.Costs:
Cost of creation and maintenance of web page
Creation of web page Cost of maintenance of web page per month Total cost of web page’s maintenance per year Web page description $1850 $410
The web page will mainly include every single product detailed with its ingredients or nutrition facts.Figure 12.
Table 1. Customer’s preferences on payment
Secondary Research . it will have a brief description of Mi Comisariato. picture of it.
Table 2. staff and gas rented for one home delivery Expected home delivery per month (based on surveys) Cost per month of home delivery service $ 3. Comparison between cost and price of each home delivery service
Table 3.Cost of transportation Cost per each motorcycle. Costs of transportation per month
Comparison between cost and price of home delivery service Cost $3.
the opportunity cost that Mi Comisariato is huge since it will have to offer a service which is not frequently used by society and hasn’t been explored by Ecuadorian retail stores. an active social lifestyle and are in a frequent use of internet. there is no actual restriction on Ecuador that forbidden the online sale. About any political issue. the next step is to analyze the data collected in order to determine if this project can be executed. About the economic scenario.SPECIFIC Customers
Ecuadorian society is not used to purchase online and no trust on service By home delivering the purchases. The first analysis done was the PEST analysis. Therefore. Macro & Micro scenario analysis
Analysis and discussion
After knowing what do Mi Comisariato’s clientele think about this project by the survey. They will demand for a safe service
Only 24% of Ecuador’s population has access to internet Deliver purchases as fast as possible
Purchasing power has increased throughout years No issue
There is no restriction that forbidden the online sell No issue
Know that online sell is not used on almost every retail store in Ecuador
Have the necessary tools to initiate this project
Even though they are groups. As regards to social segmentation. So. this type of service will benefit them
. the online sell by Mi Comisariato may not have any political or legal issue. the project is directed for customers of a medium to high social class between ages of 24-40 since they have higher incomes. they can’t damage the project on economic terms Have the economic power to invest on this type of service
May include politic characters if they have any issue with the online selling Deal with laws to ensure the protection of customers’ data
Table 4. they should demonstrate that online purchase is an effective service.
This project is categorized as product development since it is offering new type of service on an existing market. Mi Comisariato will have to set up strategies in order to show that this type of service is safe. The main advantage is that customers can purchase their goods from the conformability of their houses. the technological scenario is about comparing the advantages and disadvantages of e-commerce. Finally. So. The implementation of strategies will require a high investment from Mi
. if Mi Comisariato makes this project successful. one third of the customers will not purchase online because exists the doubt the credit card number may be copied by hackers. the issues that e-commerce may have are greater compared to its benefits. Only 24% of Ecuadorian population has access to internet. So. Nevertheless. However. there is a holding truth that leads for none or few usage of e-commerce: only 24% of Ecuadorian population has reach of internet at their houses. Mi Comisariato will have to convince to its customers that this service will be effective and safety. If the web site gets saturated of purchases. the most important is the lack of knowledge that Mi Comisariato will have about this type selling. This fact will lead to a small acceptance of online selling since there will be not enough population to explore about this type of service. this will let them expansion to other stores on other cities. practical and convenient. It is a medium risk project since Mi Comisariato will have to offer this service on a market which is not used to purchase online. Last but not least. there some threats that should be considered. so the service may turn inefficient and the customer satisfaction may be at risk. About the opportunities. However. these objectives won’t be easy to achieve since Ecuadorian society is not used to purchase online. The second important threat is the limited internet diffusion in Ecuador once the project is expanded to other cities.since it will be a practical service for them. The second analysis executed was SWOT analysis. then the delivery service for each of it won’t reach the time limit of delivering. According to the survey. so the purchases may be affected negatively of it. Regards the weaknesses. The first one is the lack of trust on online services from customers. The third analysis was based on Ansoff Matrix. Web pages may be hacked or get saturated from received sales. The main strength is that Mi Comisariato has the financial power to start the project and be the pioneer of offering this type of service on its market.
In order to avoid this loss. if this project is successful. This analysis was done in order to determine if this project was convenient or not to Mi Comisariato to execute.75 from every home delivery they do. Nevertheless. which is the web page maintenance and the variable costs is the cost of home delivery plus since it is done according to the number of purchases done per month. the main cost that Mi Comisariato will face is that they will lose almost 0. Concerning the costs. the cost of investment can be afforded by Mi Comisariato but there is a major doubt. the purchases will be affected on that manner since customers may prefer to go to the store and purchase by themselves. However. Nevertheless. Mi Comisariato must buy their own assets and hire their own staff. The investment includes
. Mi Comisariato must have a continuous following of online purchases in order to provide an on-time home delivery service. As a final analysis. The main benefit is that will gain brand loyalty from its customers by being the first retail store of its market by offering this service. Also. Mi Comisariato will have to face a society which is not used to use the online media for purchasing.Comisariato since practically they will have to change society’s perception about online selling. there are some benefits that Mi Comisariato will experience if it executes the project. So. Also. Customers will perceive that Mi Comisariato has worried about its customers by providing them a practical and convenient service. Mi Comisariato will have to face a main fixed.
Conclusions and Recommendations
Implementing the online selling and home delivery is a great idea for Mi Comisariato since it will offer them a service which is convenient and time saver. which represents a high cost of investment that Mi Comisariato can afford. there is the cost-benefit. So. it can be done on other Mi Comisariato retail stores of Guayaquil.
This legal documentation will represent an extra cost for Mi Comisariato since it will have to hire legal companies that will have to ensure that its service is totally safe in order to protect customer’s data. About the goods that will be bought by online. However. it will have to implement several marketing strategies at least during a year in order to prove that online purchasing is a practical service that must be used. there is a main issue that can let to failure this project. These products have higher prices compared to other goods. Mi Comisariato should not implement the online selling and home delivery service because of several reasons. This issue can’t be handled by Mi Comisariato since the lack of access is Ecuador’s government problem since the price of it on Ecuador is the highest against any Latin-American country. Ecuadorian society is not prepared for the usage of online media. In addition. Only 24% of Ecuadorian population has access to internet. the frequency of online purchase is once two weeks based on the survey. the doubt is that all the investment will be worth it for getting brand loyalty.creation and maintenance of web page and home delivery service payment. customers think about this service as untruthful and that there is preference for choosing the product in order to see its conditions. Mi Comisariato will be having higher revenues. The main benefit that Mi Comisariato might get is the creation of brand loyalty from customers and will be a platform for implementing this type of service on its other stores. what will Mi Comisariato decide to do when investment was already done? These doubts are the ones that create more uncertainly on executing the project because of the risk of how well accepted will be. the majority of them are for personal hygiene and home cleaning. First. If Mi Comisariato decides to execute this project. Mi Comisariato online sells will be affected by this percentage since they can sell more if more citizens have access to it. so the bills from customers will be higher. So. So. if the project does not success.
. Mi Comisariato will have to demonstrate that it service has a legal support that confirms its safety of usage. Also. changing society’s perception is not the only problem that appears. However. This frequency should increase in order to cover the costs of investment. Based on the survey. there are some topics that should be considered before executing this project. As a conclusion. As a result. So. However.
society is not used on the usage of web pages for online purchasing.
. they will have to deal with several legal and social issues. Mi Comisariato will have to implement some marketing strategies that will have to change the perception about this service. the lack of knowledge from Mi Comisariato of how does the online selling works will affect the performance of their project because as they being the pioneer. The strategies will definitively represent a high cost since at least should be done for more than a year. This lack of access may lead to Mi Comisariato with a decrease of online sales since there might be customers that want to purchase online but they do not have the access. Also. Another barrier for the success of this project is that only 24% of Ecuadorian population has access to internet.
Mi Comisariato is working on this project but on a medium or long term because right now customers prefer to chose and see what products they are buying. bread and vegetable oil. 4:30 pm. During last years. 9 de Octubre 729 y Boyacá Mi Comisariato has experienced any increase on their sales during the last three years? Yes. tuna. Interview with Eng. If the project has a good acceptance in Guayaquil. Any percentage that shows the increase of sales? Right now I don’t have the percentages. What is your competitive competitor.1. the second most sold products are soaps. noodle and detergent. Av. the number of retail stores as Hipermarket and Mini Comisariato has increased. Mi Comisariato is economically capable of investing on it since costs as maintenance and creation of a web page. El Rosado’s Manager of Purchases Date: Friday 24 July 2009. Then. What are the most sold products? The most sold products are vital goods as sugar. transportation or gas will be included? Yes. Supermaxi? advantage against your main
. milk. Bruno Sadun. Address: Mi Comisariato’s headquarters. Mi Comisariato has experienced a growth of sales but also it grew as corporation. Do you think online sales will affect on a great proportion Mi Comisariato’s sales? I really believe that our society is not ready for online sales since there is no culture of it. I can ask to a colleague and then give it to you.
gasolinas entre otros involucrarían? Sí. Bruno Sadun – Gerente de Compras de Importadora El Rosado Fecha: Viernes 24 Julio 2009. Mi Comisariato si tiene la disponibilidad económica pero por el momento tenemos ese proyecto de mediano a largo plazo ya que nuestros clientes prefieren escoger y ver el producto. Si el proyecto tuviese buena acogida. Le puedo preguntar a un colega y te puedo dar los valores. detergente. ¿Algún porcentaje que demuestre ese incremento? Por el momento no tengo porcentajes. transporte.
. ¿Cuáles son los productos con mayor venta? Los productos que más se venden son el aceite. ¿Mi Comisariato se encontraría (económicamente) disponible para invertir en dicho proyecto pues costos como creación y mantenimiento de pagina web. ¿Cree que la venta por internet afectará en gran proporción a las ganancias de Mi Comisariato? Creo que no porque en nuestra sociedad no hay cultura acerca la compra por internet. fideo y atún. El número de tiendas de Mi Comisariato y Mini-Comisariato han incrementado durante el último año.Mi Comisariato has better prices and better reach on some areas that Supermaxi is not located.Av. Dirección: Matriz de Mi Comisariato . De ahí. jabón. Entrevista con el Ing. 9 de Octubre 729 y Boyacá ¿Mi Comisariato ha experimentado algún incremento de ganancias durante los últimos tres años? Sí. leche. 4:30 pm. azúcar. Mi Comisariato ha crecido pero también como Corporacion El Rosado.
$400 $400 .$840 $840 . you purchase at:
o o o Supermaxi Mi Comisariato Other (determine)
¿Cuál es la ventaja competitiva que tiene sobre su mayor competidor.$620 $620 . Supermaxi? Mi Comisariato ofrece mejores precios y tiene mayor alcance en pueblos que Supermaxi no tiene tiendas. Date: Saturday 25 July 2009 Location: Mi Comisariato Garzota & Urdesa
Survey done to Mi Comisariato’s customers.$1060 $1060 .$1280 $1280 . Age:
3. Gender: o
o Femenine Masculine
2. Your average Income per month is:
o o o o o o o $180 .$1500 Mayor a $1500
5. continue the survey. ¿Are you willing to purchase online?
o o In case of answering no. answer this last question Yes No
8... 9. You missed going to the grocery store because…:
o o Lack of time Work events Unexpected event happened
7. o Immediately
. You will be likely to receive your purchase by. How frequent do you purchase at Mi Comisariato? :
o o o o Once a week Twice per week Once two weeks Once three weeks
6. Why you will not purchase by online?
o o No complete knowledge about Internet usage No trust on this type of service Prefer to choose the product Includes an extra value to the purchase
In case of answering yes. Why you will purchase by online? o o o Saves time More practical Agility of payment
00 $3.o o o o 11.50 $4.00 $2.$30 $30 .$80 Higher than $80
13.50 $2.$50 $50 -$60 $60 .$40 $40 .50 $3.00 More than $4 First necessity goods Personal Hygiene Home cleaning goods Fruits-Vegetables Meat-chicken
14. Which products will you buy online?
o o o o
.$20 $20 . How much your bill does when you purchase at Mi Comisariato?
o o o o o o o $10 . How often will you purchase online? o o o o
1 day 2 days 3 days 4-5 days
Once a week Twice per week Once two weeks Once three weeks
12.$70 $70 . How much do you usually pay for home delivery service? o o o o o o $1.
Usted hace sus compras de hogar en: o o o Supermaxi Mi Comisariato Otro (especifique)
5. Sexo: o o 2.$620 $620 . How will you prefer to pay for this service? o o
DessertsIce creams Can good Cash Check Credit Card
Encuestas a clientes de Mi Comisariato Fecha: Sábado 25 Julio 2009 Lugares: Mi Comisariato Garzota & Urdesa
1. Edad: Femenino Masculino
3.$840 $840 . Su ingreso promedio por mes: o o o o o o o $180 .$400 $400 .$1500 Mayor a $1500
4.o o 15.$1060 $1060 . Qué tan frecuente hace sus compras: o Una vez por semana
.$1280 $1280 .
¿Estaría dispuesto a realizar sus compras por internet? o o Si No
En caso de responder no.o o o
Dos veces por semana Una vez cada dos semanas Una vez cada tres semanas
6. responder esta última pregunta. Razones por las cuales no compraría por internet
No tiene conocimiento completo acerca el manejo de internet No confía en dicho tipo de servicio Prefiere escoger el producto y revisar sus condiciones Incluye un valor agregado a la factura
De haber respondido si. 9. Hay casos en el que no logra ir al supermercado porque: o o o No tuvo tiempo de ir Algún evento de trabajo Algún inconveniente
7. continúe la encuesta. Razones por las cuales compraría por internet: o o Ahorra tiempo Más práctico Agilidad de pago
10. ¿En cuántos días (máximo) quisiera que su pedido por internet llegue a su domicilio? o o o Inmediatamente 1 día 2 días
50 $2.$30 $30 .$40 $40 .$50 $50 -$60 $60 . ¿Cuánto generalmente paga por ellos? o o o o o o o 14. Si el servicio fuese de su agrado. ¿qué tan frecuente usaría éste? o o o o Una vez por semana Dos veces por semana Una vez cada dos semanas Una vez cada tres semanas
3 días 4-5 días
11.00 $2. En promedio.00 Más de $4
. ¿Qué artículos compraría por internet? o o o o o o o Productos de necesidad básica Productos de higiene personal Utensilios de limpieza del hogar Frutas y vegetales Carne-pollo-embutidos Dulces-Helados Otros:______________________ $1.50 $3.$20 $20 .$70 $70 . ¿a cuánto asciende su factura cada vez que compra en el supermercado? o o o o o o o o $10 .50 $4.00 $3.$80 Mayor a $80
13. Cuando hace pedidos a domicilio.
com/sitio/Historia. Victoria.elrosado. 20007. Paul. ¿Cómo pagaría por este servicio? o o o Efectivo Cheque Tarjeta de crédito
Bibliography and References
• El Rosado. Australia.15.
. Business and Management. ¨Historia¨ http://www.jsp Hoang. IBID Press.